WASHINGTON — After a botched effort to pass legislation imposing a 20-week ban on abortions, House Republicans are moving forward Thursday with what’s being dubbed a less controversial bill that codifies a ban on federal funding for abortions.
The bill would do a number of things — including block federal funds for abortion for women who are in the military, who live in Washington, D.C., and who are poor — but one aspect of the legislation that hasn’t received much attention is the fact that it would raise taxes on the vast majority of small businesses.
The No Taxpayer Funding for Abortion Act would deny small businesses a tax credit they currently receive through what’s known as the SHOP exchange, a part of the Affordable Care Act, if they include abortion care in their health plans. Roughly 87 percent of private plans include abortion services as part of comprehensive coverage, meaning the bulk of small businesses would be hit with a tax hike if the bill were to become law.
Apparently the House is so insistent on passing an anti-abortion bill that it is willing to increase taxes on small business owners. Now that’s just wrong. There is just something hideously not right with punishing small business owners.
The bill is not expected to pass the Senate. There are 53 Republicans and a vote of 60 is needed.
Aren’t there other things to spend legislative time on? I think so. The best way to stop abortion right in its tracks is to prevent unwanted pregnancy.
The White House response should the bill pass:
“The legislation would intrude on women’s reproductive freedom and access to health care; increase the financial burden on many Americans; unnecessarily restrict the private insurance choices that consumers have today; and restrict the District of Columbia’s use of local funds, which undermines home rule,” reads a Statement of Administration Policy from the White House. “If the president were presented with H.R. 7, his senior advisors would recommend that he veto this bill.”
Priorities. I cannot figure out why this one issue is the number 1 priority of any legislative body. Is this really our number 1 problem that needs to be solved? Same as Keystone.
Where are the immigration, tax, healthcare, ISIS, Iraq, etc debates. No, we get Keystone and Abortion.
All but about 3% of the population are bored to tears with both issues.
I got bored about 20 years ago but I have to keep revisiting it because someone is always trying to sneak some restrictive law in.
I wonder if some smart lawyer or group would pick up on the point that if this group of Republicans want to codify the ban on federal funding, then why did the Republicans of 2010 allow for it within the ACA? Granted, it is not a direct federal funding in the ACA, but a federal mandate is a federal mandate.
This is really about politics. Republicans will point to this legislation, which they know will be vetoed, to try to mollify conservatives who want bold action on many of the issues listed by Pat. This is an example of a cynical ploy that causes conservatives to mistrust the Republican Party.
Another issue of concern is the proposal by Obama to tax 529s to pay for “free” community college. For those of us who have put have money in 529s for years to pay for college tuition under the promise that it would remain tax-free as long as it was used for education, this represents yet another attack on the middle class. Will Republicans cave to Obama on this tax issue in order to get something in return, e.g. lower taxes for businesses?
Kelly, can we go back to the 529s? Under what conditions would they be taxed? I am very opposed to taxing these programs. 2 of my grandchildren are supposed to go to college on these programs. (set up by the other grandparent) That’s just double dealing if that money is touched for taxes.
Obama proposed to strip away the tax benefits from 529s, saying that it really only benefits the wealthy.
http://www.washingtonpost.com/business/economy/critics-pounce-on-obamas-plan-to-cut-the-tax-benefits-of-529-college-savings-plans/2015/01/23/43ea75bc-a2a8-11e4-903f-9f2faf7cd9fe_story.html
Simple solution. Make the first $200,000 tax free. Families making for than that would pay taxes on it. And no fair sneaking it through the kids.
I can’t assess whether those other programs would be more helpful or not. Those who have saved in 529s should not be penalized on what has been saved so far.
Most people making less than $200,000 can’t afford to set away college money. Maybe that’s why they are under represented. Then again, a couple each making $100,000+ a year is hardly rolling in wealth. They might be comfortable but I would hardly call them rich. They are definitely still very middle class, just perhaps in a more comfortable range of middle class. I don’t see them going out and joining RTJ.
@Moon-howler
First of all, a $200K limit is way too low in my opinion. You said yourself that a couple each making $100K is hardly rolling in wealth. Second, I grow weary of our government’s hostility toward those who are successful. Why shouldn’t money saved for college tuition be tax-free for everyone?
The real issue is that Obama has his eye on the $245B saved under 529 plans. Assuming a rate of 20-25%, taxes on 529s would generate $50B, which could fund healthcare subsidies or perhaps free college tuition, and thus expand democratic constituencies that receive government payments.
The rich get richer and the middle class doesn’t budge. Perhaps if I were rich I would feel differently. However, there is the notion that if I have a good year that I give up a little more….
There are certain people who don’t need to have tax free college. That will have no bearing on whether the kids from that house will go to college or not. On the more middle class, it might have everything to do with whether they go to college or not.
All I know is fewer and fewer kids can really afford to go to college. What should we do to make it more affordable?
More on 529s:
http://www.nytimes.com/2015/01/23/your-money/obamas-proposed-changes-to-529-college-savings-plans-would-reduce-benefits.html?emc=edit_my_20150126&nl=your-money&nlid=29018221&_r=0
@Kelly_3406
Kelly – I am with you on the 529 plans – but what they have become is a tax avoidance scheme for the very wealthy. A rich person can now place 140k tax free into a dependents (say child, grandchild, niece, etc) 529 plan and still retain control over the account. That account can grow tax free for the recipients lifetime – all avoiding taxes along the way. That was not the intent of the 529 plan – so while the middle class can tax some advantage of it, it is truly benefiting the tax avoidance schemes that the wealthily crave.
I did not know that. That’s why wealthy people will always become wealthier. They have the means to find the loop holes.
@Pat.Herve
My experience is that money from a 529 can only be used for education at approved universities. I had wanted to use some cash for a specific class that was not given by an “approved” university. There was no way to use the money from the 529 without paying significant tax on it.
The money may be tax-free when it is placed in the account, but if it is not used under a very specific set of conditions, then a large tax penalty is accrued.
If you know of a way to get around that, PLEASE speak up.
@Kelly_3406
Kelly – Yes.
Put 140k tax free (every 5 years, no gift tax, removing it from your estate) into your grandchild’s 529 when they are very young – say 1 year old. The money grows over their lifetime tax free (no tax on dividends or capital gains). When the ‘kid’ decides to take some of that money out, yes they will be taxed on it and a 10% non educational penalty – which is pennies compared to having to have paid the gift tax and taxes along the way. The very wealthy have taken this token investment and have made it into estate tax planning. Something neither you nor I can really take advantage of. Each 529 plan has it own rules about what investments are available and which schools are applicable – you do not have to be a resident of any state to invest in their 529.
Very similar to the IRA accounts of the wealthy. A rich guy who has an IRA of say $100 Million can designate his/her grandkids as beneficiaries and the account will be distributed based on their lifetimes – essentially moving $100 Million tax free to the grand kids and they get paid off of it every year of their lifetime. Paying income tax along the way, but essentially having that money grow over their lifetime income tax free.
Both of these avoidances are at the high end of the tax pyramid – meaning that the wealthy person gets more benefit from it. Same as when your boss say that the raise this year will be limited to 1.5% and he is getting the same percentage as you, but his percentage is based on a higher base and he get a bigger $ raise than you. Eventually, his salary is much bigger $ wise than yours even though you both go the same percentage each year.
http://www.taxpolicycenter.org/UploadedPDF/411147_new_edu_savings.pdf
And let me add – I would not like to see the 529 go away, but the wealthy have exploited it beyond what it was meant to be and repeatedly look to circumvent taxes. They also have the money to spend on tax estate planning that avoids taxes like the plague. Like the GRAT – http://www.taxjusticeblog.org/archive/2013/12/ultra-wealthy_dodge_billions_i.php#.VMbtjlpTs0s – where the uber wealthy can move money into an account, give money to heirs and suffer no tax consequences – but you and I do, as we do not have enough money to manipulate the system.
Tax avoidance is legal.
Ok. I believe estate taxes are on the order of 35-40% for estates >$5M. So 10% penalty + ordinary taxes for non-education withdrawals from 529s probably represent a bargain compared to large estate taxes. I still do not have a problem with it though — even for the rich. Estate taxes and gift taxes are confiscatory in nature, which is the fundamental issue. I do not necessarily agree with the government taking such a large portion of someone’s estate; of course people look for ways around it.
@Kelly_3406
much of the estate tax is based on assets that have never been taxed. Example Martha buys 10K of BRK-A in 1965 (500 shares at $20) and she passes away today – it is worth around $95 Million. Should that stock appreciation (which has never been taxed) be stepped up and not taxed?
Of course Martha being that wealthy has the resources to avoid all the tax and take advantage of complex trusts and such – so She does not pay any estate tax and the middle of the road folks like you, the family farmer and I do if your estate is over 10 million (federal tax wise) for a couple. http://thinkprogress.org/economy/2013/12/17/3073821/estate-tax-loophole-preschool/
The effective tax rate of many large estates is currently down around 16% – not the 40% marginal rate.
I don’t get something… When does double, triple, quadruple, etc taxation… take effect? How many times can the government tax the same $1? For the most part Uncle Sam already got his cut of the $ as a part of income. When do we say enough is enough?
As a country we just broke the record of revenue taken in last year. We are on pace to break that this year. How in the hell can we continuously break records on tax collections but at the same time look to raise taxes on the middle class? Fuc% that!
Either we elect people who will spend what we take in or we elect people who will tax the middle class to death. Take your pick…
You either need to join the tea party and get yourself a fife and drum or start insisting that those in wealthier tax brackets start paying a greater percent, just like you are.